German jobless rate rises

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Unemployment in Germany rose again slightly in June, dashing hopes of a long-awaited improvement in summer. Figures released by the Federal Labour Office showed a rise of 11,000 to a seasonally adjusted 4.37 million, or 11.4 per cent of the working population. Disappointed officials sought solace in the finding that all the jobs were lost in the former East Germany. In the west, seasonally adjusted unemployment fell by 1,000 to 3,041 million.

"We are seeing signs of stability particularly in West Germany," said the Labour Office. "Economic improvement is progressing, but there is still no turnaround in the jobs market."

The disastrous state of the construction sector was blamed for the disappearance of jobs in the east. Tax changes at the beginning of the year have hit the building industry hard, and the slowdown in post-unification projects has cost a large number of jobs. Cuts in the budget of make-work schemes havebrought some previously hidden unemployed into the statistics.

Officials expect the labour market to stagnate through the summer and hope for an improvement in September.